Income Tax (Trading and Other Income) Act 2005 section 685

Person liable

Section 685 identifies who is liable for tax on annual payments charged under Chapter 7 of the Act.

• Tax on annual payments is charged to the person who receives or is entitled to those payments.
• Liability falls on the recipient, not the payer of the annual payments.
• Entitlement to the payments is sufficient to create a tax liability, even if the payments have not yet been received.
• This rule applies to all annual payments within the scope of Chapter 7.